Appleton's death could delay DRAM consolidation

SAN FRANCISCO—The death of longtime Micron Technology Inc. Chairman and CEO Steve Appleton could throw a kink in rumored collaboration talks between Micron and Japan's Elpida Memory Inc. and delay needed industry consolidation, with significant consequences, according to market research firm TrendForce.

"At the moment, the industry can only hope for Micron to quickly ascertain its management team and future direction, bringing the company back on track for the tasks ahead," TrendForce said in a report circulated Saturday (Feb. 4).

Micron last month announced that Durcan planned to retire in August, at the conclusion of Micron's fiscal year. But a spokesman for the company said Saturday that Durcan has put off his retirement plans indefinitely in the wake of Appleton's death and his appointment.

TrendForce, which issued its
report prior to Durcan's appointment, said the uncertainty could have
significant impact on the development of the DRAM industry in Taiwan,
the U.S. and Japan. But with Durcan now entrenched in the role of CEO, his viewpoint will obviously be critical to any possible deal with Elpida or other merger and acquisition activity Micron is likely to engage in in the DRAM space and elsewhere.

"We are deeply saddened by Steve's loss and will miss his hand at the helm," Durcan said in a statement issued by Micron Saturday. "I have provided the board my ongoing commitment to work with the management team and continue to move the company forward."

The DRAM industry is currently under significant pressure, with declining average selling prices weighing heavily on participating companies' balance sheets. Some analysts believe that some of the weaker DRAM players may not survive the current down cycle.

According to TrendForce, Micron was the fourth largest DRAM vendor with market share of 11.8 percent as of the third quarter of 2011. The company, which also makes NAND flash chips, was also the fourth-largest NAND player, with market share of 11.3 percent, in the third quarter, according to the firm.

TrendForce noted that Appleton faced several challenges to the industry during his tenure, but was able to lead Micron through economic downturns. Micron's acquisitions under Appleton of Texas Instruments Inc.'s DRAM business in 1009 and Toshiba's DRAM business in 2001 both alleviated DRAM oversupply conditions and secured Micron’s sustainable core competence of technology value, according to TrendForce. "His death is without a doubt a great loss of talent for the industry, and it will also pose challenges for Mircon’s management," TrendForce said.

A Micron-Elpida merger did not seem likely since Elpida wanted to stay independent. And neither Japan nor US would want to suddenly be lacking in its own home-grown DRAM, if only for the sake of national pride.
But this is bad timing for Elpida and Micron alike. I wonder what Steve (RIP) would have done. We may never know.

To me clearly Micron has lousy management under Appleton. Why? Micron grew their dram business in the past by merging with TI and Toshiba and in flash as well. Now, they want to merge again with Elpida to grow their dram marketshares. This is a sign og bad management because they cannot grow by taking market shares away from rivals.
Also, Micron don't have a very low costs structure in business. If I were Micron 10 years ago, I would have move most of my operations to low cost nation long time ago. The story of Micron would have been completely different American jobs would have been lost. I'm just saying if I were CEO, I would have done that to save the company. That is the duty of a ceo.
It is sad American companies cannot compete with the low cost Koreans because the Koreans have other money ventures to back up their semi divisions. Micron doesn't. I wish I can help if my People's Project is a success. I was planning to help Micron to be the largest semiconductor company in the world one day. If they help me by testing my project once it is ready, I have a chance to help them in return. People helping people to help more people. Stay tune for the People's Project.
Ming.